Real Estate Talk and Views

This is a copy of an email sent by me to my niece and her husband after a day of shopping for a new home. I could tell there was discouragement in their voices as we looked at the first ones that they had been so excited about.  Of course, the ones we always seem to want are the ones that are just not in the budget for a family, “that perfect one” with all the stuff.  If we all could have all we want we still are not happy, not happy until we make it home, “our home”.  Here is the email, I hope you can enjoy it.

“Hope you two are not discouraged by the ones that we saw today.  As you both can see, there are no perfect ones out there. I don’t think that the perfect house is ever really found.  It is about living there and growing a family and friends.  It is a place, however humble or grand that becomes lived in and then it becomes comfortable, feels safe and secure and we know that when we come home at night, that there is love and security inside, good food and the joy of family growing and loving. That is what makes the house a perfect warm and inviting home.

We don’t have to scale back our dreams, we will have them, sometimes progressivly and eventually,  just not right now, sometimes we never get to the final part, but instead, stop to relish the journey as we make our way finding that we did get enough room, although not just the way we envisioned, maybe we did get a couple of neat things included that we did not expect but all in all we get excited because it just felt like THE place.  I hope that we can find that place that is a house for you, and together, you will make it that perfect place to have for you to raise and grow a family that is strong, healthy and full of life. “Home”

God bless you all. Now let’s keep on looking, we will find it and you will know. UB

The question that came in was this, “I filed for chapter 7 and did not reaffirm my mortgage, I plan on just walking away for the house, how does the foreclosure affect my credit?”I would suggest very negatively.  Bankruptcy pretty much kills the ability to get much done credit wise at less than loan shark rates, for several years…some even say 10 years.  A foreclosure has a negative impact too.  In one recent case, the couple selling had split up, the plan was to sell the house on a short sale, take the hit and move on. Remaining spouse filed for bankruptcy and then refused to sign any documents, planning to stay in the house for a long time. Lender went to the bankruptcy court, got the stay lifted to reclaim their property and have gone into full foreclosure.In the question the writer stated that they had not been late on their mortgage payments when they filed.  It is kind of ironic isn’t it that the mortgage company at this point is not aware that there was a problem.  My advice would be to re-affirm, stay there and make those payments. If you need to do a short sale later, then take that on as a seperate deal. If  you can make those mortgage payments and rebuild your credit with consistant and regular payments it will show up as that, “yes, you had some problems, BUT you showed character and strength in making good on your mortgage debt. It could be a powerful testimony for credit worthiness when you go to get a cell phone, utility account, or even buy your insurance. There are pleanty of people who cannot afford to stay in their home, if you can and even if you have to really stretch to make it work, you need to do that.Many lenders are trying harder to work with their customers with a loan modification. Just remember, when it comes to home values, what goes up will come down and what comes down, will eventually go back up.  How low it goes or how high it goes is not as important as making those mortgage payments if at all possible and working with your lender.When that falls apart, if it does, and you cannot make your mortgage payments that will satisfy the debt, save your money BIG time and get ready to make a change because you will be moving soon.

Is it me or is it really  happening? Communication skills and conversation I mean? Is it a dying art? It seems like over the past few months or so, I have be immersed in waves of new communication “innovations” of “new speak”  “trunkated spellings” and Tweets and “sound bite” blurbs on facebook. I have always come from the side of life that says if you don’t use it you lose it.  And I think those speaking skills go away if we don’t use them.  And that is what this blog is about today.

Just talking. No not texting, not email, just good old fashioned people to people conversations. Don’t you get tired of watching conversations on television?  I like those belly to belly, nose to nose great conversations. Good spirited debate, I bet you do too. A good conversation on a person to person level is THE BEST. Don’t you agree?

So what is the point here? Well, as a Realtor I am very good at conversations, especially about real estate and helping people out of real estate jams. It is amazing how many people are upside down on value vs. mortgage balance. Some of  us are in for the duration, got to have a place to live, right?  While others are not so fortunate. They have to move and can’t. They may be even living the night-mare of being tossed on the street, losing their home and having their credit become crap. 

When I have conversations with people in this situation, I know it does help them sort it out and tame that wild night marish beast, and they can approach the problem with an expert coach working on their behalf. That’d be me. When we understand our problems and figure a way out of it, it is a relief. And that relief can begin in those valuable conversations that I have with people who just need to talk it out, get direction so they can get on with their lives.

So, if you are reading this, I am asking you in plain English, to help me have some conversations with people who need to talk about their real estate problems. 

I am including a link to this blog at www.billpark.featuredblog.com but also I am asking you to jot down my phone number and pass that along too. It is 810.534.2005.

Speaking of conversation, come join the conversation on facebook with me. When you go to facebook.com and sign up or if you are already subscribed, look for me  under billpark@kw.com  Also check out my website at www.parkplaces.com it is a great place to search for homes around Livingston County Michigan. 

Let’s keep conversation alive and well about relevant things in your life. If real estate is one of them, then all the more reason to have a “chat” today.

Expect the best, everyday and thanks for “listening”

Bill Park

The house is listed, an offer comes in and buyer and seller negotiate and their agents hammer out the details. I will write about sellers in another post.

Buyers and their agent have a big job to do. There is a mortgage to apply for,  an appraisal to be done to determine value as the lender will see it, have inspections done and evaluations to be made.  There is more, of course, moving plans to make and hopefully a firm Clear to Close.

What is a Clear to Close?  Every Mortgage will have its own inspection process. Every detail will be reviewed. Every detail including bank deposits, appraisal results, contract details, last minute credit check, and the list goes on. So here is some advice for buyers:

• Do not list things in your purchase agreement that are not normally with a house, like toys, boats, trailers, tractors etc. Make your deal for these items seperate  from the purchase agreement. I am not suggesting that you try to fool anyone.  That underwriter is looking for things that could affect value.
• Do not change your bank account balances or show large increases or decreases prior to closing.
• Do not charge large items like furniture, items like boats and other things will change your debt to income structure.
• And, when the underwriter or mortgage lender or the mortgage officer requests something, every hour of delay getting it can delay your closing.
• Interest rate locks. Right now, mortgage rates are low. Get those rate locks in place once you are moving towards your closing.

• Oh, yes, your down payment. To ensure that you are on solid ground make sure there are funds to cover your check. Even better get a cashiers check made out to yourself for your Earnest Money Deposit.

All of these things and probably more go into the “Clear to Close.” Check with your agent and listen to that mortgage person, take notes, ask questions. Until the clear to close is announced, no closing date is possible to finish the deal. I hope these tips will help you get a house with piece of mind. billpark@kw.com.  See me on facebook.com too.

Social media, Xers, Y’s, boomers and BB’s (before boomers)…all have an opinion about texting, Face Book and Twitter to name a few. 

Being a kind of tracker of social change and cross generational marketing presents some challenges to Realtors in general.  Comments like my kids or grand kids never respond to my emails or answer their phone… have become common. Since I qualify for the grand parent level of experience in this, it is true, well mostly.

And as a fulltime Realtor awash in technology, I have learned to text, write on walls in Face Book, even upload articles to my web site. I must admit, I don’t Twitter. I was raised in the era when it was impolite to interrupt.

The reaction to my e-blast invitation to my newsletter data list to join on FaceBook got various responses. The x’ers and y’s didn’t have a problem, seemed eager to expand their friends, but some of my BB’s had a few things to say.  One thing was that they like the “old fashioned conversation and lively discussion.” “This Facebook stuff was kind of a “cult thing” isn’t it?”  Frequently said was that they did not want to be bothered with it.  Another said, “I thought that when you attended your 50th High School Class Reunion you were supposed to be retired.” And, ” the only money we spend on technology is to fix the record player so that it can play our 78’s up at our cottage….”

Oh, and for those of you who don’t have a clue what a “78″ is, it was what George Clooney’s aunt Rosemary recorded her songs on. They were black round things with grooves in them and this amazing needle thingy on the end of a metal arm actually could coax the voice and music right off the plastic groove! It was amazing, you didn’t have to download it or anything….you just sat there and listened and could even boogie to it…

Well I digress. Just remember, treat the BB’s with respect and dignity, take care of them and who knows, maybe they will do business with you. They don’t care what you know until they know that you care.

The question that came in was this, “I filed for chapter 7 and did not reaffirm my mortgage, I plan on just walking away for the house, how does the foreclosure affect my credit?” 

I would suggest very negatively.  Bankruptcy pretty much kills the ability to get much done credit wise at less than loan shark rates, for several years…some even say 10 years.  A foreclosure has a negative impact too.  In one recent case, the couple selling had split up, the plan was to sell the house on a short sale, take the hit and move on. Remaining spouse filed for bankruptcy and then refused to sign any documents, planning to stay in the house for a long time. Lender went to the bankruptcy court, got the stay lifted to reclaim their property and have gone into full foreclosure. 

In the question the writer stated that they had not been late on their mortgage payments when they filed.  It is kind of ironic isn’t it that the mortgage company at this point is not aware that there was a problem.  My advice would be to re-affirm, stay there and make those payments. If you need to do a short sale later, then take that on as a seperate deal. If  you can make those mortgage payments and rebuild your credit with consistant and regular payments it will show up as that, “yes, you had some problems, BUT you showed character and strength in making good on your mortgage debt. It could be a powerful testimony for credit worthiness when you go to get a cell phone, utility account, or even buy your insurance. There are pleanty of people who cannot afford to stay in their home, if you can and even if you have to really stretch to make it work, you need to do that.

Many lenders are trying harder to work with their customers with a loan modification. Just remember, when it comes to home values, what goes up will come down and what comes down, will eventually go back up.  How low it goes or how high it goes is not as important as making those mortgage payments if at all possible and working with your lender.

When that falls apart, if it does, and you cannot make your mortgage payments that will satisfy the debt, save your money BIG time and get ready to make a change because you will be moving soon.

Livingston County saw a nice bump in homes sales for January with sales up 30% over last year’s January figures. Before we drown in statistics though I want to mention that there are some big motivations here to kick off the new year.

The F and S words lead the way. Foreclosure and Short Sales lead the numbers with 60%.

Fair Market Value Sellers, those that are not foreclosures or short sales had their work cut out for them.  I am telling my sellers of FMV homes that they are going to have to compete with that market.  How do we do it? I mean get a home sold in under 45 days or less that is fair market, not a short sale or a foreclosure?

• Sweet Spot Pricing.  I always to do a market value analysis that is really tight. I spend a lot of time on coming up with a suggested price that will work. Most sellers of FMV know it is not a market where they can price it high and hope to find some bumpkin to buy it.  Doesn’t happen.
• Spend some time and money on fix-ups, paint, carpet and floor coverings can do wonders. Why do this when you are going to take less than what you want? People are sick of looking at worn out, run down depressing house that have been sitting empty. Toilet seats tapped, and dirty floors and walls, missing pieces. We have to differentiate.
• I like lots of pictures with my listings. Upper end properties get more pictures.  A long time ago I learned that “don’t sell the steak, sell the sizzle.”  Got to make it sizzle.
• Offer a little more drive up appeal. Spring is coming, pull out those over grown shrubs, trim those trees so you can see the house, get rid of the old junk that has been piled in back and make it “wow-able”

In this market we all have to pay attention to the details of getting the job done.

If you or someone else in your life is upside down needs to sell or has mortgage troubles, maybe I can help.  I am a Short Sale Master and Certified Distressed Property Designated agent through Keller Williams Realty and Harris Real Estate University. The lenders pay my fees and all expenses so the seller of a short sale pays nothing. Coming next blog I will talk about HAFA, Homeowners Affordable Foreclosure Alternatives and why a seller using this program needs a Realtor to help them get the rewards of this program.

Livingston County saw a nice bump in homes sales for January with sales up 30% over last year’s January figures. Before we drown in statistics though I want to mention that there are some big motivations here to kick off the new year.

The F and S words lead the way. Foreclosure and Short Sales lead the numbers with 60%.

Fair Market Value Sellers, those that are not foreclosures or short sales had their work cut out for them.  I am telling my sellers of FMV homes that they are going to have to compete with that market.  How do we do it? I mean get a home sold in under 45 days or less that is fair market, not a short sale or a foreclosure?

• Sweet Spot Pricing.  I always to do a market value analysis that is really tight. I spend a lot of time on coming up with a suggested price that will work. Most sellers of FMV know it is not a market where they can price it high and hope to find some bumpkin to buy it.  Doesn’t happen.
• Spend some time and money on fix-ups, paint, carpet and floor coverings can do wonders. Why do this when you are going to take less than what you want? People are sick of looking at worn out, run down depressing house that have been sitting empty. Toilet seats tapped, and dirty floors and walls, missing pieces. We have to differentiate.
• I like lots of pictures with my listings. Upper end properties get more pictures.  A long time ago I learned that “don’t sell the steak, sell the sizzle.”  Got to make it sizzle.
• Offer a little more drive up appeal. Spring is coming, pull out those over grown shrubs, trim those trees so you can see the house, get rid of the old junk that has been piled in back and make it “wow-able”

In this market we all have to pay attention to the details of getting the job done.

If you or someone else in your life is upside down needs to sell or has mortgage troubles, maybe I can help.  I am a Short Sale Master and Certified Distressed Property Designated agent through Keller Williams Realty and Harris Real Estate University. The lenders pay my fees and all expenses so the seller of a short sale pays nothing. Coming next blog I will talk about HAFA, Homeowners Affordable Foreclosure Alternatives and why a seller using this program needs a Realtor to help them get the rewards of this program.

The local realestate maket expectations have settled down.  If you are selling you know that the game has changed. If you are buying you are looking to pay as little as possible.  The power roles have changed is all. Buyers have what seller’s want. Seller’s have what buyer’s want, well if it is the right price. And the bank has what both buyer and seller want. The Money! In between the desire to sell and to buy there is often what is called a “Short Sale.”
I am reminded of the children’s story of The Town Mouse and the Country Mouse and the moral of that story, “better beans and bacon in peace than cakes and ale in fear.”  What does that have to do with real estate?
Ask anyone going through losing their job, their home, their dignity.

Our local newspaper comes out daily except Saturday and it has always been the local joke amongst the old timers, “looked in the obits today and I wasn’t there so I am doing okay, still lookin’ down at the sod.”  What has changed is that they still look at the obits but they go to the back of the paper and look at the list of foreclosure notices and notice of defaults list too. And they think to themselves, “whew, made it through another day.”

While it is not funny, at all, there are some lessons here that will shape how we think of how we get and spend money, from now on, for this generation at least.  My dad, Dean, was a Realtor during the 50’s and 60’s here in Livingston County.  He would say that “people always pay for their houses first”  it was the most important bill that they had. Still is today.  Home mortgages and home values should, in a perfect world, be the same and with the value going up and the mortgage going down. We love it when equity goes up and mortgages go down, don’t we? But when equity(what the house is worth) is lower than what is owed, we think of that as a disaster. We think of it as a ‘right’ a God given right that the mortgage balance should always be lower than our homes value.  Personally, I think that this is not good reasoning at all. A home is a place to live and to be safe and secure, warm and nouishing and all of that. But  is not a valid “investment” at all in the normal sense of profit and lost, at least for the short term.

And, if we can afford to live there, no matter what, the mortgage payment comes first. If we can no longer afford to live there, then we do have to find a solution. It may be a short sale. ” But what if they come after me with a deficiency?” you may ask.

So, let them come. But before than happens, negotiate with the lender as best you can first, let your Realtor do this for you. And, if you just can’t pay that deficiency, if there is one assesed at all, and there is a huge possibility of that not happening, as the very very last resort, you have to use the most powerful tool the borrower has in their “rights” bag and that is for you and your attorney to decide and discuss.But, do not use that as a way to stop your problems, only when all else has failed.

About Bill Park.  Bill Park has been a licensed Realtor in  Michigan since 1986. He is an advisor on real estate matters that pertain to the buying and selling of homes, land and commercial property.People hire him to advise, advocate and negotiate on their behalf.  He is a professional distressed property negotiator and expert. He assists home owners who are upside down in their house value and mortgage debt with disposing of the property and negotiating an agreement with the lender and the property seller to reach a settlement on the amount owed. He also assists buyers in how to find and negotiate a short sale property. To contact Bill Park, reach him by email at  billpark@kw.com

Buying a home in Livingston County Michigan has never been easier or better.  Now notice I did not say that “anybody” can do it.  But practically anybody can do it.

                  ONE TO GET READY-TWO CHECK OUT THE MARKET-

                         3 GO PAST GO AND  COLLECT $8000.00        

ONE TO GET READY-Besides having a credit score in the mid 600s you need to have a debt to income level that will allow the lender to lend you the money you need to buy. In other words, you need to be qualified by a lender BEFORE you get too serious and spend a lot of time shopping.

House prices are still declining but not as much as they have previously. In our area we are seeing the average price, that is highs and lows mixed and averaged, at about $127,000. That is down from about $147,000 at this time last year. It still is not all about price though. As I have said before, location and condition are huge factors.

                                                 THREE MARKETS AWAIT THE “READY BUYER“

2 -CHECK OUT THE MARKETS-Basically, as I see it, there are 3 markets and they change quickly nearly everyday as well priced properties are selling quickly. The foreclosure market, short sale market and the non shortsale market. Let me explain how each one works in general.

The foreclosure market are BANK OWNED Assets and well priced ones go in less than 30 days so you have to move fast and be working with an agent who can get you there. The bank does not look at these places as “homes” just assets. They have spent time and money having the asset looked at, made secure and appraised by professionals to give that far away lender “feet on the ground” and “eyes on” analysis. It is on an “as is” basis. Yet buyers come in and make even lower offers trying to steal a steal. Usually they will miss one or more before they get one. Why? Oh, for several reasons. The main one is that they want to bid too low and somebody else comes with a higher offer. Happens all of the time. If you want it then my advice is bid very close if not a little over asking.  And, have your paperwork in order from a lender who is also someone you can talk with. Most agents will roll their eyes when they hear you are working with an Internet lender some where in I-CAN’T UNDERSTAND YOU LAND or at least out of state. Trying to get the lowest rate on a mortgage is not always the smartest thing to do. I’ll take a local mortgage officer anyday.

The short sale market is a market that “tries men’s and woman’s souls.”  You will hear that it takes a long time for a short sale to go through, and it will. Usually 10 to 12 weeks to get through all of the phases. So if you want a great buy on a home that is warm and comfy inside, take care of and usually not beat out to kingdom come, then a short sale is the way to go. But if you are a time line and need to get into a house quickly, I would say no, this is not for you. Like a foreclosure, the lender has two or even 3 BPO’s or Broker Price Opinons on the property.  What this does is give them a good idea of what their “Asset” is actually worth. Remember to that this sale will be subject to their approval, and if there happens to be a second mortgage on it, they have to okay the transaction and possibly the home owner may say no to the banks proposal to them. Some times the bank wants their pound of flesh from the seller and the seller can say “no” I am not going to agree. Not always but some times. So, again you have to decide, am I a very patient person who has all of the time iin the world or am I in a hurry.

Finally we get to the “non” foreclosure or short sale.  This is usually someone who owns their home out right or they have a small mortgage. Once in awhile they are willing to bring cash to closing to finish paying off the bank. These homes generally are very nice and the seller, although they want to sell, are not going to compete with the foreclosure or short sale. There is a premium on these and they usually can do better than the others. Why? No waiting, get it now, and sometimes they will have some pretty nice stuff that they are willing to include. Sometimes, not always.  In a few sales I have noticed that they are more likely to counter offer and sometimes aggressivly. They are willing to fight for their equity. So if you try a low offer on one of these do not be surprised or offended if they come back at full price or very close to it. 

3 TO GO PAST GO AND COLLECT YOUR TAX CREDIT- Hey there is only about 90 days left to claim you tax credit on a purchase of new home by a first time home buyer. If you have owned a previous home for at least 5 years, you can also qualify for a tax credit with some qualifying conditions up to $6500. So if you would like to reach me to talk about your situation, I am generally available to do that. You can reach me on email at billpark@kw.com.  I HAVE A GREAT website AT www.parkplaces.comwhere I have plenty of search tools.  I will do a property analysis for you providing you are not working with another agent under-contract and you are in my market area which is primarily the Western suburbs of Metro Detroit and includes Ann Arbor and north to the Southern part of Genesee County and the western part of Oakland County. See you at the closing table.